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Canadian Media Resource Articles

Barrick Gold Mints 35 Partners as It Seeks Revitalization – by Liezell Hill (Bloomberg News – March 26, 2015)

http://www.bloomberg.com/

(Bloomberg) — Barrick Gold Corp. Executive Chairman John Thornton wants his executives to have skin in the game. To do that, he’s rolling out a Wall Street-style partnership to give them significant stakes in the world’s largest gold producer.

Barrick this month named its inaugural 35 partners, a group that includes mine managers as well as the most senior officers at its Toronto headquarters, according an internal memo obtained by Bloomberg.

Partners will receive long-term incentive-based pay in the form of restricted stock that can’t be sold until retirement or departure. The shares will comprise more than 50 percent of total compensation for the six most senior executives in the partnership if targets are met, and after five years all the partners will be required to hold stock worth multiples their base salaries, according to Andy Lloyd, a Barrick spokesman.

A partnership model is something more typically associated with financial services, according to Steve Chan, a consultant who advises on corporate pay. Its adoption by Thornton, a one-time senior banker at Goldman Sachs Group Inc., is indicative of his intentions to return Barrick to its entrepreneurial roots after becoming weighed down by debt amid falling gold prices.

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Northern First Nations concerned about the sale of claims in Ring of Fire – CBC Sudbury Points North’s Jason Turnbull Interviews CBC Reporter Jody Porter (March 26, 2015)

http://www.cbc.ca/news/canada/sudbury Chiefs from the First Nations closest to the Ring of Fire say the Noront deal has left them disillusioned with their discussions with the province. Click here for the interview: http://www.cbc.ca/player/Radio/Local+Shows/Ontario/Up+North/ID/2660868646/

Underneath the chrome [Ring of Fire] – by Kip Keen (Mineweb.com – March 27, 2015)

http://www.mineweb.com/

Why Franco-Nevada is playing in the Ring of Fire.

The Ring of Fire, an Achaean greenstone belt in Northern Ontario, has become synonymous with – and infamous for – chromite. Cliffs Natural Resources was until couple years ago to put the region on the map as a new global mining centre of the stuff. It has, as many will recall, scuttled those plans and agreed to sell its assets – chiefly a series of chromite deposits, but also a lot of interesting exploration claims – in the Ring of Fire to Noront Resources, the leading junior still operating in the remote region. Among other chromite assets it is chiefly developing a modest-sized nickel-copper-palladium deposit.

At the heart of the deal is Franco-Nevada, the leading gold royalty company. It’s lending Noront $22.5 million to cover the $20 million acquisition cost of the assets. Along with the five-year loan at 7% interest, payable in an accumulated lump sum at the end, it’s also paying Noront $3.5 million to secure Franco-Nevada a couple NSR (net smelter return) royalties. Most directly, Franco-Nevada is to get a 3% NSR in Cliffs’ large chromite deposit, Black Thor.

Franco-Nevada: Chromite? Of course in the grand scheme of things Franco-Nevada is not that floored about chromite. This should come as no surprise. For, if getting the NSR on Cliffs’ old stomping ground is kind of nice –

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First Nations oppose Noront, Cliffs deal in Ring of Fire – by Jody Porter (CBC News Thunder Bay – March 26, 2015)

http://www.cbc.ca/news/canada/thunder-bay

‘We’re not in such a rush. We’re willing to do this well,” Eabametoong Chief Elizabeth Atlookan says

Plans by Noront Resources to buy Cliffs’ chromite assets in northern Ontario’s Ring of Fire mining area are a “barrier to future opportunities” and a “threat to aboriginal and treaty rights,” say First Nations chiefs opposed to the deal.

Noront announced the $20-million deal on Monday. The purchase requires court approval and won’t be finalized until at least mid-April because Cliffs’ Quebec subsidiary is in restructuring proceedings under the Companies’s Creditors Arrangement Act.

The Matawa Chiefs Council, representing the eight First Nations closest to the proposed mine sites, went public Wednesday with plans to stall the deal before it is finalized.

“Our rights to the chromite deposit are recognized by the fact that the province and mining companies have already made promises to share revenues and benefits from development,” said Neskantaga Chief Peter Moonias. “We should have had a voice in the sale.”

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Mining analyst weighs in on sale of Cliffs’ Ring of Fire – CBC Sudbury Points North’s Jason Turnbull Interviews Mining Policy Analyst Stan Sudol (March 25, 2015)

http://www.cbc.ca/news/canada/sudbury The mining policy analyst and owner/editor of www.republicofmining.com, Stan Sudol says the Noront Resources got a good deal in its purchase of Cliffs Natural Resources stake in the Ring of Fire. Click here: http://www.cbc.ca/player/Radio/Local+Shows/Ontario/Up+North/ID/2660705564/

Creative destruction, eh! Why there’s no reason to fear the demise of Canadian companies – by Joe Martin (National Post – March 26, 2015)

The National Post is Canada’s second largest national paper.

Don’t worry about the demise of Canadian companies. Others will replace them and become world beaters in their fields

Some observers are concerned by the destructive nature of capitalism in Canada that has seen the demise of Nortel, the near demise of BlackBerry, and the flight of automakers to Mexico. The list goes on and on. Most educated observers are aware of the problems, fewer are aware of the creative processes that continue to breathe life into the Canadian economy.

A recent Economist article noted “A lack of larger firms means fewer jobs, and a less resilient economy.” So what has happened in the Canadian corporate sector in the past 30-plus years in terms of larger employers?

In 1980 the 10 largest non-financial corporate employers had nearly 650,000 employees. In 2013, the most recent year for which there is comparable data, the top 10 employers had over 1.1 million employees, an increase of 72% at a time when the Canadian population grew at a rate of 43%. Not all of these jobs are in Canada because Canadian businesses have become more globally oriented, but then not all the jobs were in Canada in 1980.

Eight of the 10 companies on the list in 2013 were nowhere near the top 33 years ago. Let us first look briefly at the two largest: Onex, a Canadian private equity (PE) firm and Walmart Canada, the Canadian subsidiary of the American retail colossus, and then at Magna and Alimentation Couche-Tard.

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Why Teck Resources should buy HudBay Minerals: Analyst (March 24, 2015)

http://www.bnn.ca/

– by Michael Chu, Producer, BNN

With rumblings in the market that Teck Resources Ltd. (TCKb.TO -2.33%) could be on the prowl for acquisitions–especially on the copper front–could HudBay Minerals Inc. (HBM.TO -0.95%) be square in the sights for the Vancouver-based base metals giant?

Analysts at National Bank Financial outline the perfect storm of events that could bring Teck and HudBay Minerals together.

“The combined company would provide; near-term growth, long-life diversified operations, and carry less financial risk. In our opinion, the possible combination of these two companies is intriguing and would result in an improved outlook for Teck Resources,” wrote Shane Nagle, metals and mining analyst at National Bank Financial in a note to clients.

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Nevsun Resources Ltd describes reported attack on Eritrea mine as ‘act of vandalism’ – by Claire Brownell and Peter Koven (National Post – March 24, 2015)

The National Post is Canada’s second largest national paper.

Nevsun Resources Ltd. is describing an attack on its Bisha mine in Eritrea as an “ act of vandalism,” an account that contrasts starkly with African media reports saying the mine was bombed by Ethiopan fighter jets.

In a statement released Sunday, Nevsun said vandals caused minor damage to the base of a tailings thickener at the mine during the night shift on Friday, releasing water into the plant area.

But the Ethiopian news site Tigrai Online said it had confirmed a report that the Ethiopian air force bombed the mine on Friday. Sudanese newspaper Al-Sahafa was the first to report that the attack was a military operation from Ethiopia.

“The Bisha gold mine which is about 150 km from the city of Asmara is on fire and a huge fire and smoke can be seen from far away,” the reports claimed.

But Haywood Securities analyst Stefan Ioannou said he believes Nevsun’s account over the online news report. He noted that the company’s shares opened just 3% lower than Friday’s closing price of $4.55 on the Toronto Stock Exchange, suggesting most investors weren’t taking reports of an air strike very seriously either.

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Brad Wall’s good potash play – by Jack M. Mintz (National Post – March 24, 2015)

The National Post is Canada’s second largest national paper.

Premier Brad Wall of Saskatchewan is now under fire for his 2015 Budget that promises a potash tax review as well as a curb on some investment incentives for the potash industry. Some are calling his bold move a “Stelmach” moment, comparing the ever-popular Saskatchewan Party’s premier to Premier Ed’s royalty review for the Alberta’s oil and gas industry in 2007-8.

‎Saskatchewan’s royalty review is far from being a comparable situation to Alberta’s. Brad Wall inherited a clumsy complicated potash royalty system devised by the NDP in 2001-2 while the Alberta royalty system was relatively well designed before Stelmach started stirring the pot.

If anything, the Stelmach government was making the system worse with proposals that increased rather than reduced distortions. Moreover, Stelmach’s play was a revenue grab while Wall has finally taken a step to clean up a messy system with the promise not to raise revenues under the review. If there is any criticism to be laid, it’s that Wall should have acted sooner.

Wall now has a unique opportunity to not only reform potash taxation but also to ensure a politically stable tax system that has the right balance between competitiveness and public revenues. The major flaws in the current Saskatchewan system are threefold.

First, the system is unfair with differential treatment of potash companies depending on whether they existed before or after 2001-2. Companies after 2002 are taxed on their volumes differently than companies operating before this time.

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Cliffs Natural Resources-Noront Resources deal puts new Sudbury smelter in limbo (CBC News Sudbury – March 24, 2015)

http://www.cbc.ca/news/canada/sudbury

Smelter plant hinged on yet to be negotiated power rates, tax dollars to access Ring of Fire

A proposal for a new smelter in Sudbury has been pushed further into limbo after Cliffs Natural Resources announced a deal to sell off its Ring of Fire assets.

The Cleveland-based company said Monday it had entered into a definitive agreement with Noront Resources to purchase its chromite deposits and associated claims for $20 million.

Then Sudbury MPP Rick Bartolucci announced in 2012 that Cliffs would be building a smelter in Capreol, north of Sudbury, to process the chromite it mined in the far north — along with hundreds of jobs. The company even started taking job applications.

However, the new plant hinged on yet to be negotiated power rates, as well as tax dollars, to access the remote Ring of Fire. Neither issue has been settled since. With the sale of Cliffs’ chromite assets and associated claims to Noront Resources, the ball is effectively in Noront’s park.

However, CEO Al Coutts said the company is focusing on mining at this point — not smelting.

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Ring of Fire: Ontario has ‘gun to our head’ First Nation chief says – by Jody Porter (CBC News Thunder Bay – March 24, 2015)

http://www.cbc.ca/news/canada/thunder-bay

Neskantaga Chief Peter Moonias says Ontario has a ‘hidden agenda’ to support Noront Resources

The Ontario government has put ‘a gun to the head’ of First Nations leaders trying to negotiate a fair deal in the Ring of Fire mining area in the James Bay lowlands, Neskantaga Chief Peter Moonias says. His comments came within hours of Noront Resources announcement on Monday that it had struck a deal to buy Cliffs Natural Resources assets in the area.

Chiefs were informed of the deal at the same time as being told that the province has set an April 1 deadline for a decision on the next step in Noront’s environmental assessment for a proposed nickel mine in the Ring of Fire, Moonias said.

“There’s a hidden agenda,” he said. “We are being targeted with a gun to our head. We have no more opportunity to study the process.” The deadline doesn’t allow enough time for community members in the nine First Nations closest to the Ring of Fire mineral deposits to be informed, Moonias said.

The Matawa First Nations are engaged in a negotiation process about the mining project under a framework agreement with Ontario. Moonias said the sudden announcement of the tight timeline left him disillusioned about the talks.

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Crummy chromite investment – by Kip Keen (Mineweb.com – March 24, 2015)

http://www.mineweb.com/

Cliffs exits the Ring of Fire.

So ends Cliffs Natural Resources’ adventure in Northern Ontario with the miner announcing that it has a buyer for its Canadian chromite projects. It was an expensive one.

A half-decade ago Cliffs paid some C$350 million in cash and shares to buy majority control of a series of then newly discovered chromite deposits. They were heralded as world-class with potential to supply the North American steel markets especially.

In 2009 and 2010 Cliffs struck deals to buy the juniors involved in the discoveries. It bought Freewest Resources for about C$240 million (in shares at the time). Then it bought up Spider Resources in 2010 for C$125 million (cash).

These were the juniors that put the region on the map – the so-called Ring of Fire. The potential was often billed as huge – a nebulous ~$60 billion or so in deposit value.

The region garnered promises from the Ontario government especially for major spending on infrastructure. For it was remote and would require new road access hundreds of kilometres long through bush and First Nations territory.

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Noront Resources buys Ring of Fire claims for $20 million (U.S.) – by Madhavi Acharya-Tom Yew (Toronto Star – March 23, 2015)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Shares of Noront surged nearly 37 per cent on the deal, announced Monday. The stock gained 13 cents to close at 48.5 cents on the TSX Venture Exchange.

Toronto-based junior mining firm Noront Resources has agreed to pay $20 million (U.S.) to Cliffs Natural Resources Inc. to purchase the U.S. mining giant’s chromite properties in the Ring of Fire.

Shares of Noront surged nearly 37 per cent on news of the deal, announced Monday. The stock gained 13 cents to close at 48.5 cents on the TSX Venture Exchange.

“We are convinced that the Ring of Fire region is going to be the next major mining camp in Ontario. We’ve been looking at acquiring more land there and getting more deals done,” Noront president and chief executive officer Alan Coutts said in an interview.

“When Cliffs announced they were going to pull out of the area, we thought, ‘This is a natural fit for us.’ ” The miner said it will buy the shares of two Cliffs subsidiaries that own 103 claims, adding to its own holdings in the Ring of Fire area, about 500 km northeast of Thunder Bay, Ont.

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Ontario’s Ring Of Fire, Formerly ‘The Next Oilsands,’ Sold For Peanuts – by Sunny Freeman (Huffington Post – March 23, 2015)

http://www.huffingtonpost.ca/business/

A junior miner will soon be the biggest player in Ontario’s fledgling Ring of Fire mining development, after agreeing to pay US$20 million for the properties of Cliffs Natural Resources, a U.S. mining giant who has abandoned hope of developing the area.

Toronto-based Noront Resources is getting quite the deal for about 103 mining claims — including Cliffs’ flagship $3.3 billion Black Thor chromite deposit — in the region estimated to be worth $50 billion during the height of the commodity boom. Cliffs paid $240 million for the assets in 2009.

The market has since shifted and a lack of concrete movement in talks between First Nations, government and developers has turned many miners off of the 5,000 square kilometre area said to be rich with chromite, copper, zinc, platinum and other valuable metals.

The Ring of Fire was once touted as Canada’s next oilsands, but interest in the area has fallen off and the prospects for development in the remote region, located on First Nations land, have dimmed.

Cliffs decided to suspend its projects in the area in late 2013, citing numerous delays and difficulties that prevented the project from moving ahead.

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